SEC Sees Temporary Setback in Request to Access Binance.US Software

SEC Sees Temporary Setback in Request to Access Binance.US Software – The judge has declined to grant the United States Securities and Exchange Commission immediate access to Binance.US’s software, stating that he is not inclined to permit the inspection at this moment. A hearing was conducted on September 18 to address the SEC’s motion, urging Binance to provide detailed information and facilitate executive depositions, which had been a source of dispute between the two parties over the past week.

During the hearing, Judge Faruqui expressed reluctance to grant immediate access, suggesting that the SEC should formulate more specific discovery requests and engage with a wider range of witnesses, as reported by Bloomberg on September 18. The SEC has consistently asserted its difficulties in obtaining information from Binance.US since it filed a lawsuit against the American branch of the crypto exchange, its global affiliate Binance Holdings Ltd.

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As well as CEO Changpeng “CZ” Zhao on June 5, alleging involvement in the sale of unregistered securities. On September 15, the SEC accused Binance.US of noncooperation in the investigation, citing BAM Trading, the holding company for Binance.US, as having produced only 220 documents during the discovery process. Many of these documents were described as unintelligible screenshots or lacked dates and signatures. 

Additionally, BAM had declined to make essential witnesses available for deposition, agreeing to only four depositions of witnesses it deemed appropriate. While Binance had previously characterized the SEC’s repeated discovery requests as overly burdensome, the SEC contended that Binance was uncooperative despite having agreed to a consent order on discovery in the SEC’s case related to unregistered securities operations and other allegations.

Judge Faruqui’s ruling, refusing the SEC immediate access to Binance.US’s software and related documents, represents a partial setback for the regulatory authority in its ongoing legal proceedings against the exchange. A key focal point for the SEC in its case against the crypto exchange is the custody of Binance.US customer assets. The regulator contends that a more comprehensive investigation of Binance.US is necessary to uncover potential connections to the global branch of the exchange.


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